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tv   U.S. House of Representatives  CSPAN  June 4, 2010 10:00am-11:48am EDT

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environment and society where every home is safe and secure, and where men and women can both feel safe and stable nobody has to be in a home or at one is accusing the other or being subjected to physical or emotional violence of any sort, sexual assault, any type of crime against anybody in their own home, particularly women and children. our goal is to make sure we have an environment where women and children and men can all live safe, healthy, successful lives. we want everybody to have that good outcome. host: did you ever go home as a judge and cry? it is hard up there on the bench. guest: what you see is really sad. it is abominable. i think for people like me, that is what motivates us to go to work every day, to take an opportunity to say that this has got to change and mobilize
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the resources and the support of the community to make a difference. unless we do -- until we do that, unless we participate in making that change -- we need to work together and devote our attention and resources to make a difference. host: susan carbon, thank you for being on "washington journal." thank you for joining us today. "washington journal" will be back tomorrow morning. the former president of shell oil, a new book, "what we hate the oil companies." booktv kicks off at 8:00 a.m. tomorrow morning. for the full schedule of nonfiction books over the next 48 hours. enjoy your weekend. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] .
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>> today on book tv. >> c-span, our public affairs content is available on television, radio, and on line. you can also connect with us on tour, facebook -- twitter, facebook, and youtube. >> next, law officials talk about -- an event hosted by the immigration and customs enforcement bureau. this portion runs about two and half hours.
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>> good morning. we will be getting started here. once again, good morning and welcome to the ipr center. my name is rick halverson. in the unit chief at the center. i will be your mc today. a few housekeeping notes before i introduce our first speaker. here at the ipr center, for the restroom, there are keys. there are two restaurants directly behind the auditorium. the doors should be open. if we have a fire emergency, and i'm not aware that we will have a test today, we will exit out the doors in the back. we tend to muster by the volleyball courts. with the microphones that you see above you, they do pick up
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conversations from the back and will transmit them throughout the entire auditorium. i have heard conversations in the back that people probably did not want me to hear. i just want to make you aware thattthose microphones are on. we try to minimize them at the break, but please be aware of that. there are a quick scheduling notes. we are switching one of the presentations this morning. at 11:30 a.m., we will be having dr. jeremy wilson from michigan state do his presentation on the links between counterfeit pharmaceuticals and ioc. that is the change that is different than what is in the program.
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with that, i would like to welcome our opening keynote speaker. aretino speaker this morning is mr. james dinkins. he is the director of investigations for i.c.e. i.c.e. is the second-largest criminal investigative agency in the united states. it is the largest investigative arm of the department of homeland security. we employ more than 6700 agents. prior to assuming the directorship, james dinkins held a number of key leadership positions within i.c.e., including special agent in charge in washington, d.c., special agent in charge in baltimore, and he also ran our financial investigations program at headquarters.
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he also served overseas in frankfurt, germany. he began his law enforcement career with u.s. customs. he later transferred to san francisco. he went on to detroit. he also holds a bachelors of science of criminal justice from the university of detroit. ladies and gentlemen, i would like to welcome director james dinkins. [applause] >> good morning, everybody. i want to -- i'm not going to take up a lot of your time. i was looking at the agenda and it looks like you have a full day ahead of you already. i do want to welcome everybody here to the ipr center. thank you for coming to the symposium. this is the largest conference we've had at the ipr center since we opened two years ago. i think it is very fitting that the topic is one of the most important topics, dealing with
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i.p. theft. that's the connection between terrorism, organized crime, and i.p. theft. the connections are real. i think you'll hear some great case presentations later this afternoon that really drive that connection and those links home. there are two presentations coming in from special agents in charge. i think you'll find those very enlightening. as many of you know, and as represented by the audience today, the challenges combating i.p. theft crosses the globe. it crosses many boundaries. it crosses many different disciplines. in attendance today we have representatives from the motion pictures association, the international anti counterfeiting coalition, pharmaceutical securities institute, and nonprofit organizations like rand corp., as well as their academic
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community partners from michigan state. whoever is here from michigan state, i give you a shout out. we're also joined by members of u.s. law enforcement, i.c.e., fbi, and nypd. finally, we have for law- enforcement -- foreign law enforcement partners. they have all travel great distances to be here today. we all know we really want to make a lasting impact. if we really want to make a difference, we will have to work hand in hand with our private sector partners. through combined efforts, we can most effectively and successfully combat not only i.p. theft, but also the
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organized criminal organizations that feed off those proceeds. in closing, and i do not want to take a lot of your time, i want to thank you for coming here. i want to point out two things i think you hear during the presentations. terrorist organizations are similar to any other organization. they need to earn money. way out. i.p. theft is often one of the avenues. in addition, without a partnership, -- i want to thank you all for coming to the ipr center. thank you for your partnership, not only with i.c.e., but with all of us at the ipr center. together we can make a difference. i think you'll find the presentation very enlightening. without taking up much more of your time, i want to say thank you. i hope you enjoyed the
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conference -- enjoy the conference. [applause] >> excellent. our next speaker on the agenda is mr. john newton. john is the interpol intellectual property rights program manager. his primary concern is to build on the achievements of the interpol intellectual property crime management group. an essential part of this is the further development of an integrated global training and operational capability to facilitate and coordinate international enforcement action against transnational and organized criminals engaged in i.p. crime. this includes the fully
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interactive on-line investigators college. it will ensure public and private sector i.p. crime investigators to benefit from this. ladies and gentlemen, i would like to welcome mr. john newton. [applause] >> thank you. good morning, everybody. first, i would like to thank the ipr center for inviting me to be back here this morning. i'm going to talk about the role of interpol and what we do with our member countries to try to deliver a collective success with all our partners. before i go into that, it's worth seeing a bit about interpol -- saying a bit about interpol.
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we are based in france, which is where the general secretary is. we have a fairly standard approach. we have an executive committee, which advises presidents and secretary general on day-to-day business. we also have 188 member countries. each of those countries has a central bureau. our data is protected by the commission for control of interpol files. my secretary general, mr. noble. as you can see, intellectual property rights is part of the high techs crimes area. dealing specifically with intellectual property crime, we are the central point of reference for all 188 member
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countries. we also act as a central point of reference for all public and private sector stakeholders. a lot of my time is spent working with i.p. crime affected industries. we also raise awareness about the extent of organized i.p. crime. traditionally, customs has been very involved in this matter, but police have not. as a result of what we're doing, far more police forces are actively engaged in this subject. the focus of our activities is actually the fleeing -- actually deploying training. do that by coordinating and facilitating these cross industry law enforcement interventions. interpol is an international organization. no vested powers. all the interventions are done by the national law enforcement
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agencies. our role is to help coordinate the activity across their regions and increasingly globally. have our own database dealing with intellectual property crime. we're working with our partners to develop the college, which i will mention as we go. in terms of what i'm going to talk about today, i'm going to try to show you how we work with our partners to deliver success. the first thing is the subject matter of the congress today, which is the involvement of organized crime and other groups -- matter of the conference today, which is the involvement of organized crime and other groups. i will show you how we build capacity and work with law enforcement agencies, police, and customs. then i will talk about the college in some detail. in terms of i.p. crime, we try
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to avoid getting involved in definitions. we have a very broad definition of i.p. crime. we use intellectual property crime as a generic term. we do not like to spend too much time talking about definitions. we tried to do things about it. we work with a lot of industries, 40 different industries. the common denominator for all our activity is the transnational organized criminals. in some respects, from an objective perspective, the ip crime element is incidental. with the growing incidence of i.p. crime, which affects the health and safety of consumers, is an important issue for us. let's talk about organized crime. i'm not like to refer to
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statistics. i'm going to tell you what our experience is. two years ago, we had 18 member countries providing information about i.p. crime. two years later, we have 145 member countries providing us with information about ip crime and telling us how they are affected. of all the reports we are getting from those member countries, 48% of all the cases are transnational. that means they involved two or more countries. furthermore, 12% of those cases are linked with other types of organized criminal activity. that is arms trafficking and people trafficking drugs and all sorts of serious crimes. as we go from a regional program to a global program, and we're starting to get an overview of the work we're doing in the various regions, we increasingly see the same things in every
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interpol region. on the ground, we see the same types of products, which is indicative of a common supply chain. that's another good indicator of organized crime. increasingly, there's a lot more private types -- product types that have implications on the health and safety of consumers. in south america, 17% of all seizures are of counterfeit or substandard toys. we are in no doubt that the intellectual property crime is an industrialized, manufactured distribution process. it is certainly regional. all the indications are that it is a global activity. it is all interrelated. that is our view on organized crime. in terms of what we're doing to try to counter this, i want to quickly run through some of the areas we're working in and give
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you an idea of how weak operate with our member countries. -- how we operate with our member countries really been working very hard in africa in the last few years. it is an important region for a spree we're working hard to build capacity and provide training. -- is an important region for us. we're working hard to build capacity and provide training. particularly our pharmaceutical crime unit. as you can see, we've encountered 100 different types of counterfeit and substandard medicines during those operations. we've also been working in southeast asia, a number of countries in this area. again, working with the private sector and the authorities targeting counterfeit medicines. what i want to talk to you about in some detail is what we've been doing in south america. we have been working there since
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2005. we're in our fifth operational region. to date, there have been seizures made by those law enforcement agencies value and the region of $302 million, and over 700 arrests. this gives you some indication of what we do in these countries. we provide integrated training. the model is to go in, train the operational people, and then we deploy. the training tends to be two or three days, followed by weak operations -- week operations. the photograph at the bottom is quite interesting. on the bottom right, when we are working in parts of africa, there's no legislation to deal with trademark counterfeiting infringement. we often have to use different
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parts of legislation. in terms of resources, they do not have ways of doing analysis of the examples. one of the things we do when we go to member countries and mount these operations is we provide them all with digital cameras to help them capture images of the seizures. that is one of the things we held due to build capacity. the main thing we do, we work with them to try to identify what the problems are and how we can work with them to make interventions -- these are some more images. i want to talk more specifically about an operatioo that's a good example of how we can work with member countries, the private sector, and other stakeholders to make a difference. we originally started this in 2005. at that time, there was a big
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issue about counterfeit products coming from. wh-- coming to brazil, and also finding its way to north america. we were developing our own capacities for the first time. we were trying to bring together these regional operations focused on i.p. crime. that was the focus of our activity in the border area. it was focused on this area. we provided the leadership. we brought the public together. we worked with our regional bureau buenos aires. we have participation from those agencies. for the very first time we did this, we had supporters of the
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program. we were trying to focus the attention of police and customs to seek to what extent we could coordinate simultaneous activity on either side of the border. we got much more sophisticated. we started to look at the ports used to import products mainly for originating from southeast asia into south america. we looked at the distribution networks. worked with the country's down there. we worked with other countries, including uruguay and chile. these were the deployments. we spent a lot of time on the ground working with our colleagues. our role was very much based on
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coordination. these are some images of the work in brazil. in 2008, the number of countries increased to seven. that was a much more conference of operation. by now, about 25 different industry actors working with us on the ground. in terms of results, you can see from the chart, in terms of seizures, it was very modest. as we build up momentum, the seizures are much bigger. now we have a situation where those countries are fully committed to the process. their team to support the operation -- they are keen to support the operation. there's a similar pattern with the arrests.
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what are the collective benefits? what did we achieve? we raised the profile on i.p. crime as a priority. by working with the various police agencies, we have increased and developed the i.p. crime investigative skills. they have gotten pretty good at investigating this type of activity. you also have dedicated i.p. crime units down there now. in chile, there are 13 different units. i would like to think we're a part of the incentive for bringing that in. there's much better thecontinui. there's much better communication between the various agencies. the police and customs the mansion is working well. that's not always an easy relationship.
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-- the police and customs dimension is working very well tip that's not always an easy relationship. where are we now? the operation we are currently running is not a three-month operation. this is a 12-month operation. we are extending the entire operation from the southern part of south america right through the whole continent into panama and also into the caribbean. again, integrated training and deployment. into the new countries and building capacity. the last two months of the year, there will be a south america whiide operation jupiter. lot of the countries that were brought into the equation do not
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necessarily have the experiences resources allocated to this issue. that is somewhere where we can help. increasingly seen around the world. same chemicals in different parts of the world. i've talked a lot about training. we really think training is very important. put a lot of emphasis on this in the last two years. through our various training seminars, we had a series of one-week i.p. crime training seminars. two weeks ago, we were and simple. we had the western and northern i.p. crime national workshops. we have 28 countries represented there and 140 police officers.
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we spent four days training and two days looking at the operational aspects. how are we going to work in west africa. we have not worked there before. we need to do our training much better. we need to be much more effective. this is a big world. we go into regions and we come out. we need to have a much more reliable mechanism in place so we can consistently deliver high-quality training. in the interpol community, we find that in some countries in africa, for example, they know nothing about i.p. crime. then you have the other extreme, very sophisticated i.p. crime capabilities. when we run these one-week courses, it's hard to deliver a syllabus where all the students have a common understanding of the issues.
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we need to try to solve that problem. the way we're going to do that is by introducing the international i.p. crime investigators college. this is a joint initiative. we are working to produce the very high quality online interactive i.p. crime training capability. the purpose behind this is not to replace any other agencies training. we want to make sure that the agency's work with, whether it is police or customs or whoever else it is, on these operations. we want them to have a common understanding of what we're doing. they need to know the problems. they need to know the best practices. they need to know how they can work together with the international community to make a difference. that is something we are very keen to do. this is a mechanism to do it.
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the introductory level will be available at the end of this year. one of the issues we spoke about is how we can make a very sophisticated tool readily available to african countries. some of them do not actually have computers. one of the things we're doing currently through the management board is looking at how we can use materials we are developing. how can we make them more relevant to our member countries? we're having to look at a lot of innovative ways. from my perspective, the most important thing is to have a consistent platform. people will be able to access it. all our future crime activities will spin off that college. all our training, operations, activities will have that as a permanent presence. i'm going to quickly show you an overview of the college.
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>> the mission is to deliver a leading edge training. it is mandated to develop, coordinate, and the minister training programs to support international efforts to prevent, detect and investigate, and prosecute transnational organized i.p. crime. with support from its partners, it is creating a central standardized training program that will be available world wide. it will serve the needs of interpol partner organizations and other international stakeholders. the training program will provide self directed e- learning.
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students will also have the opportunity to intent instructor led classroom training sessions, and will have access to various printed and electronic training materials, such as an i.p. crime crim investigators emanmanual. the iipcic management board has been developed to oversee the college. the board is working closely with investigators from law enforcement agencies, regulatory authorities, i.p. crime affected industries, and other subject matter experts to develop the training materials and modules for the college. the training modules will contain real examples. by using practical scenarios by in case studies, students will be able to apply what they
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learned to their day-to-day operational responsibilities. the training program will consist of three levels, introductory, intermediate, advanced. investigators to complete the introductory level will learn how to identify i.p. crime and initiate actions. students who successfully complete this level will be able to take the intermediate level training. investigators who complete that will be able to lead investigations and provide colleagues with specialized advice and direction. in the advanced program, students will be given a unique opportunity. advanced level students will contribute to collective interpol-led regional initiatives and strategies to reduce the impact of i.p. crime on their own countries. advanced level graduates may
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also be considered as a candidate to become a interpol ipr program national i.p. crime coordinator. the three levels of training will be rolled out in stages. introductory level modules will be produced during 2010. students will be able to enroll in the classes by january 2011. the intermediate and advanced level programs will be gradually introduced in 2011 and beyond. iipcic will insure that all investigators have a common understanding of the problems facing them, aware of each other's competencies' and rolls, know what interventions and strategies work, and able to work together in partnership to achieve the objective.
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>> that gives you an insight into what we're trying to achieve. that is the vehicle that we use for delivering the training. it is fully interactive. the most important thing from my inclusive organization. involved in this process. level three. investigative college represent us in country and make sure that materials -- which are generic, not confidential it is accessible and around the world. that is where we're going with it. we feel that it is an inclusive solution for not only our member
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countries, but also private crime investigators will be working with us. investigators who understand what we're trying to achieve. they will be able to work with us on these interventions. that is the end of what i wanted to say. i hope that what i have been working very closely with our member countries and the private sector to try to deliver success. we have had a degree of success. we want more success. we think we have a very good apply consistently around the world. we just need to build our own capacity. between stakeholders. unit -- they have a lot of information about
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counterfeit products, but they do not have the ability to investigate these crimes. we are actually able to bridge the gap between the police and the health agencies. also, the problems facing customs. by working with partnerships, we are adding value to the whole process. i want to again highlight the great support we get from our public and private sector support, either by working with us on these operational deployments, and work that we do. those are my comments. i think i have five minutes for any questions, if there are any. when i first came to america and gave presentations, i ask if
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there were any questions, and i used to get these looks like i am getting today. i used to think that it was so good and they cannot think of any questions. i've begun to realize that because i speak funny, most of the time they do not know what i'm seeing anyway. if that is the case, i apologize. there must be at least one question. there's one in the back. good. >> [inaudible] >> we are not specifically involved directly with the south african authorities. that is an organization. interpol is involved. a lot of the counterfeit products are there many years.
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that is currently in existence. i know the south african authorities are working very hard to do with a can to counter that. we're working internationally to do that as well. would that our program, we are not directly involved in that because of our own commitments. we try to work with multiple countries to address common problems. i'm not sure i answered your question, but i hope i did. any more? yes? >> an operation like jupiter or those in southeast asia, is there an additional follow up? is there a follow-up within the specific nation to continue the work? is it looked at as a way to elevate awareness that they will see that it is good? do they ever report back on additional seizures? >> yes, there is full up. we consistently go back to south
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america. we are committed to working in south america for another two years. with africa, we are building capacity there on the i.p. crime side. they're very committed and we're very committed to working in africa. we have run quite a bit of operations in east africa. we had colleagues from east africa, over and talk about their experiences. we are able to evaluate what was effective. one of the biggest things that came -- out came -- and the issues -- on the was an absence of see. legislation for intervention. we do evaluate these operations. constantly keeping in
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through our private sector people who deserve our support. we have recognized that given the nature of our organization and the work that we do and our limitations of staff, we need to better at that. that's why i'm hoping this college ill be a mechanism for doing that. in terms of the operations, we have a very comprehensive evaluation process. also, apply those in other areas. the other side to it is in africa. until we started working in africa. neither had most of my colleagues. we are learning. on a very steep learning process. from over 100 countries.
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expertise, but we do not the answers. research goes on as well to are. able to comprehensive approach. like everybody, we could deal with a few more soldiers. >> when you run your operational exercises, you mentioned the number of private sector participants is increasing. what is your expectation in terms of what you ask them to deliver? what is it that you want from them in terms of participation? >> we've gone through an interesting learning cycle with the private sector. we have found that some private sector entities are very well organized. they put a lot of resources into investigating this type of
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thing, both internationally and nationally. we find that some of them do not put those resources into it. with some private sector organizations, and this is not just to a private sector, some are more committed to the process than others. we look for the right attitude. by that, i mean, i wanted to come along and contribute to the program. they can contribute in a lot of different ways. each organization has a different way to contribute. they can help me identify people on the ground that we will rely on and make sure we get the right people to the training. they need to be available. they need to be available when seizures take place. they have to generally support the program. we do get a lot of support and
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direct funding from a wide range of public and private sector bodies within our financial guidelines. my expectation is that if the private sector organization wants to work with us on these organizations, i do not need passengers pick did they get one chance. if they do not deliver -- i cannot afford to set up these big things and have the private sector come in and take away the context from 28 countries. that does not help. it is truly a partnership. we're a all have the same objec. everyone contributes whatever they can in whatever way they do. we have moved to a situation now that i do not have to go out and look for partners. they come to us. they know the benefits they get from working with our organization and pooling our
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resources. >> interpol from the perspective >, does interpol see ipr exclusively as a trade marking and counterfeiting good program? where do you see industrial espionage? or, where do you see the illegal distribution of movies, business software and entertainment software via the internet. how you calibrate your primary concerns? >> we tried to keep it simple, which is why we use the generic definition. in the early days, we were very focused on cd's and dvd's. we went through a learning process. as time went on, we got more involved in a range of different commodities.
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in terms of what we do, i constantly try to look for what i call the intervention 0.4 interpol. what is it that we can do that nobody else can do? traditionally, that has been focused on counterfeiting and piracy. as we started collecting data through our database, we got more involvvd in training. as you know, to these criminals, it's just another commodity. as things have moved on and things have got more digital, i reached out to the various industries affected by online piracy. what is it that interpol can do that nobody else can do? we've been having a discussion for quite some time now. we are struggling to find out how interpol can actually make a difference. it is something we are visiting. from my perspective and from a policy perspective, i focused on
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the organized criminals do we keep it simple. counterfeiting and piracy. we do what we do best, which is coordinating the national and international operations. and also, this international college to set a standard. with this college, i want everybody to have access to it so that when we run the training programs, the people that, and know what we're talking about to start with. then we can be much more counterfeiting and piracy, and how we're going to work together. >> thank you to john for his presentation. [applause] next will be an industry panel to talk about current trends and emerging threats.
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>> good morning. i am responsible for the underwriting laboratories and by counterfeiting program. i want to thank the ipr center
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for hosting this historic event on a topic that is long overdue. i feel privileged to play a very small role. i would like to introduce my distinguished panelists. to my far left is bob, the current president. he most recently served as the director of investigations. prior to joining the industry, bob served as the law enforcement community in several institutions, beginning his career with the new york city police department and retiring as sgt. he had appointments in the u.s. virgin islands and in florida. michael robinson, the senior vice president for content
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protection, joined the motion picture association of america in 2006 following a distinguished law enforcement career that spanned four decades. in his current role, he leads in four small operations and counter measures for the motion picture association, paramount pictures, sony pictures entertainment, 20s century fox film corp., universal studios, walt disney studios, and warner brothers entertainment warn 8, . tom kubic is to my right. prior to joining psi, he had experience as federal law enforcement specialist, an fbi
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director, and criminal investigative positions. as a group, we decided there's a lot of expertise here and we want you to take full advantage of their expertise and their knowledge. >> i want everybody to be interactive and ask good, accounting questions. -- and ask good questions. a small video to start with.
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>> brian asked me to do a quick
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introduction to the panel. if you think john talks funny, get a load of this accent from new york. [laughter] i want to briefly touch on three investigations i was involved with when i was with the recording industry. the first is a video that you just saw, which was a joint investigation with the nypd. it was involved in the manufacturing facility that was producing music and movies. they were selling this to consumers around the tristate area. we ended up finding out what was going from that investigation which was that they were also producing this type of dvd's. they were using the funding to fund this type of propaganda of videos. where the investigation ended up
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i could not tell you because the joint terrorist task force took over. i will tell you about two other ones. when i was with the recording industry, we were involved in the execution of a search warrant working with the nypd in washington heights. during the execution of the search warrant, 18,000 pirated movies and music were seized, along with the sum of tens of thousands of dollars. later on when they were born to the wreckage, they found out there was numerous wire transfers of tens of thousands of dollars to the holy land foundation in texas, which has been the operation of several investigations into the funding of hezbollah. when i was involved with the philadelphia major crimes unit, the principal was arrested.
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these people were selling counterfeit movies and music. the joint terrorism task force obtained information that this organization had acquired over $2 million to suspect palestinian organizations. let me say what we do know. we know that terrorists are smart and organized.. they search for low risk, high profit ventures. counterfeiters have sophisticated distribution channels. when the two of these folks come together, we should all be very concerned. i would just like -- to like hopefully this never comes. if there's a shipment of counterfeit goods that contain poisonous agreements, that could be more devastating than a well- placed car bomb in times square.
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there is a linkage. you saw the videos. this is not just information that is not first hand. i was involved in some of these investigations. it is out there. it is high profit and low risk. these people go where the money flows. with that, i will introduce the rest of the panel. >> technically incompetent. [laughter] how to ensure this program? -- how do i shut this program? exit. great. ok, after listening to the three preceding speakers, you probably have been unable to determine my
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origin based on just my discussion here today. that's because after 10 moves in the fbi, serving in the west coast, east coast, northeast, and southwest, i totally eliminated any vestige of an accent from chicago, my original hometown. that will probably be a good thing in the current administration, to be from chicago. frankly, i cannot think of a more difficult topic for either the private sector or law- enforcement in general then to consider these three elements. that is, organized crime, terrorism, and intellectual property crimes. all of these areas, whether it is the organization or the crime itself, it is generally cloaked in secrecy. to further complicate the mix, i want to spend a couple more minutes to talk about a fourth area, which is white collar
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crime. i want to do that to highlight some of the distinctions and some of the differences that we know based on studies of organized crime, terrorism, and white-collar crime. with the specific regard to the u.s., organized crime and white- collar crime are two major concerns to law enforcement. unlike ordinary street crime, these activities are vast amounts of illegal proceeds for the criminal organizations involved. in comparison to organized crime, white-collar crime generally involves an enterprise. that is, there's a business entity and a partnership. according to current federal statutes, it could be an association. i have known john newton for six years really have no formal relationship, but we have an association. both white-collar crime and organized crime are progressed
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through the enterprise. that said, one of the differences is that organized criminals generally maintain discipline in the organizations through violence, threats, of course, intimidation, and extortion. that is in contrast to the white collar criminal, who basically maintains a relationship in the organization through fraudulent statements. additionally, in contrasts -- they generally have a business element as part of their criminal activity. the i.p. counterfeiting clearly falls within that ralm. what do we know about organized- crime? in the u.s., the organized crime took root in the 1930's during the era of prohibition,
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and remained hidden for roughly 30 years until 1965 when a presidential commission was established under president johnson to further explore organized crime. .
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russian mafia and a whole series of other organized groups who were exposed. what do we know about counterfeit measurements? the the pharmaceutical sector did that have a presidential commission. in contrast, what they're recognized in the early 1990's was the counterfeiters were counterfeited the products of multiple manufacturers. a drug regulator, they frequently found multiple products were counterfeited and they saw a need for an institute collate that data.t the move from italy to the u.s.
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where it has been operating since 2002. what we know about counterfeit medicines? in our annual report for 2009, we found in incidence of verified medicines worldwide at 2003 total incidents. earlier you saw jobs statistics and reports from various countries that are members of interpol. we found the same type of increase occurring last year. last year we saw the number of drugs counterfeited increase by 36%. world wide there were 808 different medicines counterfeited by this group. we saw an uptick counterfeit
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is no longer the 90-day supply the rather 1000 units and above. we also saw a major increase in arrests world wide, arrest for counterfeit medicine up 60% last year with the total number 1468. we'll come back to some other questions and examples of organized crime involvement in the counterfeit medicines question. i will say the actual instances of terrorist organizations being engaged in counterfeit medicines is fairly small and fairly limited and it may well be that we have not pulled back that veil of secrecy and how they are
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manipulating that behind the scenes. thank you. >> there may be some that are skeptical about organized crime being involved in the manufacture of his illegal the dvd's or any other product. there are some great presentations to be made. let me change up the facts and. something else out. it is about the economy. it is about money. it's about jobs. the available numbers are only estimates and have to be taken with some caution, the pattern is very clear and unmistakable. one estimate -- by one estimate,
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trading counterfeit goods has grown eight times faster since 1990 then the trade of legitimate goods. the international trade commission estimated a loss to the u.s. due to counterfeit goods at $5.5 billion in 1982. by 1988, that estimate had grown had $60 million. by 1996, $200 billion. the u.s. estimates the 2005 figure is somewhere between $200 billion and two under $50 billion -- $250 billion lost to the u.s. economy.
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the theft affects our industry as well. the industry as a whole estimated lost over $18 billion to counterfeiting and piracy. in the u.s., that was over $6 billion. what that inter \ but stu on a day-to-day business -- what's that interprets to on a day-to-day business is jobs, taxes. 140,000 jobs lost, $837 billion in revenue, and $20 billion in output, feeders, distribution, and affected industry. movie piracy is not just about the hollywood stars and the producers of a blockbuster movie. is about mom and pop video stores that cannot survive
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because peddlers on the streets. it's about kids not getting the after-school job selling popcorn -pat the theater because the theater cannot survive. there is a distinct connection between organized crime and movie piracy. you will hear from someone from rand who will talk about the study that rand conducted that makes it clear the connection to organized crime. game violence, money laundering in the united states. extortion and hong kong. human smuggling, exportation in northern ireland. human smuggling in spain. money laundering and extortion in italy. gang violence in mexico. in mexico, the drug cartels have
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become so bold with their counterfeiting that one group and another group now identify their counterfeit goods with their logo placed on the packaging. a serious problem. the link to terrorism is there ken holt carla -- and i hope carla speaks to that. it is a serious problem that we need to do something about. there are several things that i think are required. i applaud the center for hosting this symposium today to bring attention to the serious and growing problem of organized influence on
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piracy. not every act of piracy cannot be linked to organized crime. not everyone growing marijuana is related to organized drug cartels. there is a strong link between a lot of the activity that occurs and organized crime. this is an example of a recent blockbuster film and how quickly activities breads. let's talk about "iron man 2." before that film was shown, we identified 24 unique recordings of that that were conducted in various countries. our studios watermark the content so we can tell when we pick up a pirated dvd exactly what theater and what country the original recording was conducted at.
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there were 24 recordings that showed up in the u.s. some were just ordeal. pirate organization will capture a video in one theater in one language and capture ordeal in another language and distribute its worldwide. seven full camcorders he were recorded, two in mexico and one in the u.s. 24 audio tracks from every country and that you can imagine. this is organized. it is big scale influence. what can be done about it? it is about harnessing political will, getting governments to understand that this is something not to be scoffed at, not just about pharmaceuticals and health and safety issues
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which are important. it's also about our economy, jobs, and our survival as a country. is about deterrent sentences. slaps on the hand did not deter individuals from continuing the activity. it is frustrating for law enforcement and for those of us in the industry that see the loss continue and don't see actions continue. he is about sharing intelligence. we have a tremendous amount of information that we welcome the opportunity to share with governments. that is why this symposium is so important. is about public education, getting people to understand that -- i draw analogies to the
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movie industry but the analogies for other industries is the same. most citizens would not walk into a blockbuster and put eight dvd under their arm and walked out with it because they know it is piracy. they think nothing about downloading it on the internet. people are going to sites that look and feel like legitimate sites and do not know they are being set up to lose their identity, credit cards, personal information as well. i would love to see a notice -- you know when you travel and they want to know how much money you have brought in by taken out of the country? whether you have any goods with you? i would love to see a noticed that says, it is illegal to import counterfeit goods.
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there are some other things that can be done as well. i will turn it back to you, brian, and we will take some questions. >> i came back from japan and they had that in a customs form. what strikes me -- this is the first time the linked to organized crime and terrorism. what will be the outcome that has blocked or al qaeda is using this money to bring weapons against us? is this more of a public domain? how do we get that information out there? how do we exploit it so these counterfeits are not being produced? >> one of the keys is the follow
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the money trail. i do not think that is as coordinated as it could be right now. it is coordinated on the drug enforcement side and on other activity. i do not think a group is looking at the type of money that falls in and out of the sale of counterfeit goods. i will give you an example. in new york city, they have these high-rise buildings in midtown. years ago we used to call them vertical flea markets. multiple floors or compromise with counterfeit goods, whether it was movies, books, every type of product you could imagine were in these buildings. we look -- we did an undercover
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operation. to get into the building, to rent a room, we had to pay $25,000 key money. then you have to pay the rent. look at the flow of the traffic going in and out, with vans to come in, fedex packages, look at the amount of cash we paid just to get the room, it is a tremendous amount of money, at least equal to what you see on the narcotics trade with much less risk. >> one of the reasons it is important to understand the nexus between organized crime and whatever product is that law enforcement will allocate resources based on the privatization of the product
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that is known. to the extent we can show organized crime is involved, it means they have access to better international transportation routes, they are connected to other countries and cities around the world and they can move more product more readily. by drawing that connection, the sense is that there is a bigger resource commitment to the problem. the example i like to use is in 2009, there were 844 tons of cocoa leaves on the market. in the same year, the reported seizures of 426 tons of suspicious or a legal medicines. then you look at resource commitment is made against the
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counterfeit trade and you'll see there's a wide disparate assortment of resources. that is really the value in fully understand the threat posed by organized crime and terrorist groups. >> it is easy money. it really is easy money. no one is paying attention to it. we will take some questions from the audience. i speak funny, too. i am from scotland. i am really messed up. yes. [inaudible] >> how would one participate? >> anybody want to --
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>> i do not know how many are you are familiar with the council of europe. is roughly 46 nations and they have undertaken a project to standardize and to draft the convention against counterfeit medicines. they produced the first draft. that will go through a process and go back to the countries four assessment. it has been a topic in terms of the medicine component going back to 2004 at some conferences where the nations that participated said they were somewhat hamstrung. going back to an early point, it is essential to have that task force operation because the knowledge of the drug regulator couple months the knowledge of
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the police and federal regulators and the customs service. that is kind of a short answer to what is currently underway with regards to the medicine convention. >> they are very active in measuring the effectiveness of to counterfeiting and copyright and other violations. >> i want to add one other thing. this is a trade agreement that is being negotiated between countries. they get a baseline standard. that is something that has been in the works for a while. >> you guys have been doing this a long time. do you see things changing during recessionary times?
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>> it is obviously about money and it is about the availability of his money. we have not seen a dramatic shift in piracy. what we do see a shift in is away from what we might see as a traditional hard goods into more internet-based activity and in other systems of delivering content. >> i think that holds true across industries. a lot of brick and mortar applications are being displaced by online sales, websites that are based in china. it is a difficult situation to prosecute when they are based offshore. >> that is a growing threat to
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citizens. i mentioned it in my remarks. websites that are selling products whether it is dvd's that you cannot mail order or handbags or even pharmaceuticals that you can get online. a lot of these websites have the look and feel of legitimate websites. you can use a legitimate process and there would be wrapped in pads that are a legitimate. we need to regulate and control that much better from the standpoint of protecting citizens who otherwise are duped into going to those sites. >> i will pick on bob. what is your assessment oo the level of improvement in the willingness of local enforcement
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authorities and prosecutors tooo get into this kind of stuff? " i think it has been terrific. i have not seen as much engagement in many years. i will talk about state and local first. look at the new york city police department. the have a dedicated unit. lapd has a piracy unit. we work in mississippi in establishing the first state why i.p. task force which will utilize the state and local resources throughout the state of mississippi. new ark, new jersey, has one, too. they are doing a terrific job. icc had a forum in boston. i really am impressed with low
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of engagement and given competing priorities, i think it's terrific. we have had a terrific partner. >> is it right to have these type of discussions? is the devotion -- is it evolution? >> i think we are seeing that than i am pleased with that. they will pass and it was funded this year so there are dedicated resources given to federal agencies including fbi and ice. there is funding through the justice department through assistance for state and local i.p. task forces. all that suggests very positive for the future in improving our collective efforts.
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it takes some time to get people educated and to focus their resources on it. we have to do the same thing with judges in the courts. this is not something that should be treated lightly. >> is there an awareness campaign that has been launched to let the public know that counterfeiting on the internet, fragrances, hair-care products, that that is directly linked to organized crime and terrorism? >> one of the positions icc takes is despite the level of you're not going to be able to arrest your way out of this problem. if we do not get to the consumer and limit the demand, there will be an uphill battle.
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to carry that message forward, we have worked with mayor bloomberg's office. cbs super screen, kodak jumbotron, we let the cmers know that when you buy these goods, you're supporting criminal activity, terrorist groups. we have also done that in los angeles. we have done that in the airports in france with customs. we have done it in mexico city. the point you made is well taken. we have a committee that looks into these things. we're trying to do some kind of internet awareness campaign. we're out there with that. >> there is government and non- governmental organizations
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building public awareness. on the private sector side, there is a partnership for safe medicine which serves to echo warnings and advisories that are brought out or published by the fda. they are active in public awareness and pointing out the risk for some of the rest to buy medicines online. there are a couple -- there is like a tool to track -- a dual track. and effective strategy is to follow the money. national law enforcement authorities in the u.s. or any country to track and to find those monies and to seize those moneys. it comes back to how you can maximize disruption of the crime group, recognizing these have to
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be control strategies. we tend to think that we'll stop organized crime. that is an impractical philosophy. what you can do is to build the public awareness and also to ensure that the effort is to control organized crime and to maintain some semblance that we understand that if we commit these crimes, we're going to lose our profits and go to jail. i think that is an important element of the strategy. i know it is something that in terms of pursuit of money, investigations are pursued by the department of justice and by ice. i think they understand that. it is often missed by the public. >> we have time for one more question. >> there is an uptick in the
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amounts to a commercial quantities. the have an idea why that is? >> i think the most recent example comes from all places finland. finland recently reported an increase in seizures. seizures this past year. earlier in february, we saw the rest of 36 individuals in israel who were engaged in distribution of counterfeit medicines. that is unusual. it applies to all industries. the manufacturers -- is not always the organized crime figure who is involved from the acquisition of raw materials to
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the distribution of sales. you have groups that will trade in counterfeit medicines, movies, counterfeit dvd's, records. but that same group does not necessarily manufacture those products individually. why is there more, is your basic question. part of it is because of better enforcement and trading information that is disseminated. china last year began in november outbound examinations of products and have detected an increase and sees a substantial amount of counterfeit meeicines leaving the country. >> we have a short question >>.
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my question is about the payment platforms, especially about web- based commerce. are they cutting that off? what can be done? what is now being done? >> that is a complex question. let me comment that they are an important player. we are in consultation with several authorities about what can be done the >> ok. >> i would like to thank the panel. there was a lot of good information. you guys will be here for the day but you can stop and talk with them and have a good conversation. thank you very much for your time to be here. [applause]
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>> ladies and gentlemen, that brings us up to a break. from my watch, i think we are almost on time. we will take a 15-minute break to stay on track and that would put us to just about 10:45. there is coffee and tea out in the lobby area. thank you. >> our next presentation will be
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made by the department of justice two and the attorneys i have appeared next to me i would like to introduce. to my right is bruce ohr. he has served as the chief of the criminal division for the u.s. department of justice since 1999. he was an assistant u.s. aatorney in the u.s. attorney's office in new york from 1991 to 1999 and was chief of the violent gangs unit. he was an associate at the san francisco law firm from 1998- he graduated with a degree in physics. he graduated from harvard law and clerked on the d.c. circuit
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until 1988. to his right is andrea sharrin and she is the deputy chief in the criminal division at the department of justice. she supervises 14 attorneys and has responsibility for all aspects of international prosecution as well as training. she is an adjunct professor of law at georgetown university law center. she was an assistant u.s. attorney or she prosecutee a wide variety of criminal offenses. she joined the department in 1992 through the honors program of the civil division. she graduated from brooklyn law school.
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ladies and gentlemen, bruce ohr and andrea sharrin. [applause] >> thanks, rich. former colleagues today. our goal over the next 30 minutes is to give the a brief introduction to the department of justice's view of the intersection between organized crime and intellectual property theft. i wanted to start by making a point that i think a couple of speakers have made that organized crime has been changing rapidly in this country and around the world over last couple of decades. it was beginning to be recognized him as an issue but
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think it has been the advent of globalization that has really brought home the changes in organized crime. i think the public perception has lagged somewhat behind. i think most people are still thinking about "the godfather" or "the sopranos." in some ways they have been overtaken by new crime. there is rapid globalization and the fact that borders no longer mean anything in this business world. i am afraid that law enforcement in the united states has been playing catch-up. there have been -- there has been a trickle of cases that has
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given us glimpses of how the smoking dragon worldthere is te cases. in many ways, the response to the changes in organized crime were somewhat slow and not particularly connected in an integrated way. i want to talk about how that has changed and how i think we are trying to retool and reposition our resources to tackle the new kind changes, particularly in areas such as i.p. crime. decade, those of us who have worked these cases that things were changing, the groups were more international and
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more difficult to work. about two and a half years ago, the department said, let's take a hard look at organized crime and try to see what constitutes organized crime these days so we can figure out whether we have been addressing it effectively. we consulted with the law enforcement agencies and with other agencies and did our best to assembled a threat assessment. what we found was pretty alarming. we found organized crime groups emanating from any country in the world had grown rapidly in size and in power over the last 15 years. we think in terms of extortions and loan sharking.
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it has just exploded. there were involved in any kind of crime you can imagine. of intellectual property. this was underscored by the intelligence community. through criminal networks avoid regulation. is flooding the world market with your products. is likely to increasingly threatened industries that depend on fashion, pharmaceuticals, computing, finance, entertainment, and publishing, all u.s. economic strengths. this kind of crime is more than just a criminal problem but a
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national security problem, as well, which is something we began to see when we first looked at this. we looked at the exploding world of another crime and to our horror, cybercrime was becoming -- cyber crime was becoming a tool. this could happen with just a click of a mouse. organized crime groups penetrated world markets here in the yen stays and all over the world and were attempting to dominate and manipulate these markets. activities were accompanied by an increasing amount of public corruption and violence around phe world, which left them in many places immune to any kind of law enforcement action.
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we figured that through our survey of organized crime, the government's response was lacking. there were some responses but they were scattered. there was no concerted effort to meet this problem. we did several things. we pulled together the attorney general's organized crime council to pull together all the heads of law enforcement bodies to try to look at this together. that includes ice, the fbi, the dea, the secrets, service internal revenue service, the diplomatic security service from the state department, and we pulled these folks together and we ask them to consider the threats we had uncovered and to
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come up with a response. we issued the strategy that resulted from that in 2008. it emphasized several different areas that law enforcement had to improve its performance in if we were to address these areas effectively. one of the important was to bring together the information and intelligence that existed concerning organized crime activities into one centralized enforcement law- could look for connections and come up with a more effective response. in following up on that, we created something called the international organized crime intelligence and operations center. it got stood up last year and is -- it got started up last year.
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it allows us to identify these groups and target their vulnerable points and in hands investigations that are trying to attack these groups' activities. we tried to court made the information to hone in our view on the theft of the organized crime groups. another area was to do a much better job of cooperating with people who would not have been doing cooperating so well in the past. we emphasize working more closely with state and local law enforcement. brian will talk about some of the kinds of cases he has been seeing. we emphasize our foreign partners.
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many defendants will not be here to be prosecuted in the united states or will be difficult to get into the united states. we try to work more closely with private industry to identify places where they see vulnerabilities by monitoring their businesses and to give us a hint about where these organized crime groups are operating. once we have this confirmation, we use the traditional investigative methods that have been developed over decades by the fbi and by prosecutors for attacking and dismantling organized crime groups, whether you start with sophisticated investigated means such as wiretaps, to helping corporate of witnesses, flipping defendants against these
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organized crime groups. in the end, we feel it is important to have the ability to put these guys behind bars and charges.withric chrico as we have been implementing the strategy, we found that we need some specialized knowledge. there is stuff that is highly skilled, they do not possess the experience and skills to investigate some of these crimes and they have to start picking these things up, whether it is the working of securities markets or how cybercrime operates. how intellectual property death
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ring's work, how they district their property, how they get it out to the customers and how they get that money back to the people who put all this together. as we move toward this area of organized crime, we discovered we have an overlap in how to attack the growing problem i.p. of -- the growing problem of i.p. theft, how we combine our team and put these kinds of cases together and address an area which is not been well covered until now. for now, i'll turn it over to andrea. >> thanks, bruce. i want to thank the center and
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for the invitation here. i want to compliment them on this excellent logo. the eagle in the center is aggressive. i am concerned he will fly out of the screen. we have heard a lot about some of the challenges and growth of organized groups engaging in intellectual property crime. we know why we're starting to focus on this area. organized criminal groups are turning to intellectual property as a means to finance other illicit activities or for profit. it has an impact on our global security and very often engaged in intellectual property crime are also talking gains in loss of other dangers of fences.
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human smuggling, drugs, guns, and so on. so what is the allure? what is the alluue to organized crime? why are they turning to i.p.? you have heard everybody say it is low risk. there is very low manufacturing or entry costs. minimal start up costs. it's like they're going to get their manufacturing facilities up to code. there not paying taxes or providing insurance. they did not have to create new methods to distribute their counterfeit goods. beacon used existing distribution chains -- they can use existing distribution chains. they use slave labor to do the
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manufacturing of the counterfeit goods


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